Bikini barista stand owner goes before judge

EVERETT — Carmela Panico is no longer in the coffee business, her lawyer told a Snohomish County judge Friday.

Panico, 51, has sold off at least two of her controversial bikini espresso stands and is leasing the other Java Juggs and Twin Peaks to her former manager.

“She is out of the business of running espresso stands,” Gil Levy said.

The Seattle attorney on Friday tried to convince a judge that there wasn’t probable cause to jail his client for intimidating or tampering with a witness.

Police arrested Panico on Thursday based on allegations that she was pressuring baristas not to cooperate with Everett investigators. Her manager also alleged that Panico was threatening to fire her and kill herself if the woman worked with detectives.

Panico has been under investigation for nearly a year for allegedly running drive-through brothels out of her roadside coffee huts. Detectives say that Panico was assisted by a former sheriff’s sergeant, who allegedly tipped off the former exotic dancer to ongoing police investigations focused on her businesses. Darrell O’Neill, a 30-year police veteran, reportedly received sexual favors for his cooperation. He resigned in July.

No charges have been filed against Panico or O’Neill. Everett police say the investigation is ongoing. They have identified more than 100 baristas who work for or used to work for Panico. They obtained hundreds of hours of surveillance video. They also have spent months combing through Panico’s financial records.

She reported making more than a $1 million from her coffee stands. Some baristas told police they made hundreds of thousands of dollars working for Panico. Police allege that some baristas were providing sex acts in the stands and engaged in prostitution with customers outside of the coffee shacks. Witnesses say Panico knew about and encouraged the prostitution.

Panico appeared in Everett District Court on Friday afternoon. She said nothing, letting her lawyer do the talking.

Everett police allege that Panico’s baristas were sent a text message in August, advising them not to talk to detectives. The text reportedly said “tell cops that you have an attorney named ‘Gil Ley’ and slam the window.”

About a week later they were sent another message, recanting the advice. Instead, the message said it was up to the baristas whether to cooperate with police or to get a lawyer. In this message the baristas were warned that they would be fired for “flashing, prostituting, or getting arrested for such activities.” They were advised to “keep it clean.”

After that message was sent, officers reported that baristas told them they were advised to not talk to police. Detectives also reported that when they contacted two baristas at the coffee stands the women said they were represented by “Gilly” or “Gil” and slammed the stand window shut. One woman later reported that she’d never spoken to the lawyer or paid any retainer.

“There were multiple baristas who were influenced by Panico’s advice which resulted in missed opportunities to interview them due to false information provided by Panico,” an Everett police detective wrote in an affidavit filed Friday.

The stand manager also reported that Panico is pressuring her to testify that detectives forced her to talk, and to say that she lied about Panico’s involvement with any criminal activity at the stands, court papers said. She reportedly complained that Panico has been making her work nonstop and calling her day and night. The woman said Panico also has started to record her and threatened to turn the recordings over to police.

Levy argued that police didn’t provide enough proof that Panico was interfering with the investigation. Threats to fire someone or harm herself don’t constitute witness tampering or intimidation, Levy said.

He also said the manager, who now is leasing the stands from Panico, has a financial incentive to make false allegations against his client.

District Court Judge Tam Bui found probable cause for Panico’s arrest.

Snohomish County deputy prosecutor Bob Hendrix asked the judge to set bail at $250,000. He argued that Panico appears to be liquidating assets, a clue that she may flee.

She is attempting to sell her home to pay for her legal expenses, Levy said.

Bui ordered the woman held on $100,000. She also ordered Panico not to talk to the manager about the case. Panico also is prohibited from contacting any past or current baristas from her stands.

Diana Hefley: 425-339-3463; hefley@heraldnet.com.

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